Study results prove that higher education sector is short by one billion euros

PricewaterhouseCoopers’ consulting firm Strategy& stated in the report that an additional 800 million euros should be allocated annually to tertiary education and scientific research. Moreover, the universities must get a one-off allowance allowing them to catch up, which will require 300 million euros. Of the annual 800 million, 400 million euros should be allocated to scientific research, while 200 million euros should be earmarked for investments that should have been made a while ago. Another 200 million would enable the universities to offer more small-group teaching.

The aforementioned figures do not have any bearing on the coronavirus pandemic, which is also costing a lot of money. The report’s findings relate to the period before 2019. They also do not have any bearing on the hundreds of millions of euros that became available when student grants were abolished and student loans were introduced instead.

According to the report, universities of applied sciences should be awarded a more generous budget, as well. The authors of the report feel that while Dutch universities of applied sciences have enough money to teach their degree programmes, they do not have enough to conduct applied research. At present they are utilising 65 million euros from other budget posts to be able to afford that applied research. And when it comes down to it, the universities of applied sciences should be conducting more research than they are. This will require an additional 120 to 270 million euros per annum, depending on the desired number of professors.

In other words, the tertiary education sector as a whole will require approximately 1 billion euros per year – a number Minister for Education Ingrid van Engelshoven actually brought up herself more than a year ago.

The universities and academic medical centres are very happy with this recommendation issued to the incoming Cabinet, but have already stated that even more funding will be required, as they feel that Strategy& did not take into account the fact that enrolment figures have risen considerably since 2018, and also failed to include all sorts of new ambitions with regard to research and innovation.

Universities of applied sciences, too, reacted favourably to the report, although they claimed they needed even more money than the amount recommended by Strategy&’s consultants. The universities of applied sciences interpreted the report to mean that up to €130 million would be required on top of the regular funding to prevent students from dropping out. This is not a correct reading of the report, which merely states that reduced drop-out rates among students attending universities of applied sciences would allow for better use of roughly that amount.

The nationwide student associations ISO and LSVb were happy with the report, as well. When student grants were abolished in 2015, students were promised better degree programmes, but the student associations feel that this promise was not kept. They claim that the hundreds of millions of euros that became available when student grants were abolished are currently mainly being used to plug holes in universities’ budgets, which is why additional funding would be a good idea.

So the message is simple: more money is required. However, the real question to be answered is: how to properly distribute that money? The Berenschot consulting firm was hired to answer that question, which resulted in a report that was also submitted to the Lower House. At present, the amount of funding allocated to tertiary education institutions is largely dependent on their student numbers, which comes with certain disadvantages. If a degree programme does not attract many students – e.g. Dutch literature – it will be hard for the department in question to keep offering said programme. And what can universities of applied sciences situated in shrinking rural regions do to survive? Should they reduce the number of degree programmes they offer their students?

Tertiary education institutions would like to receive ‘steadier’ funding that is less dependent on enrolment figures, as this will allow them to look ahead properly. Berenschot does understand that position, but refrained from drawing any hard-hitting conclusions.

According to the report, the various education institutions are so different that it is hard to come up with a one-size-fits-all overhaul of the funding allocation system that will solve everyone’s problems. Which is probably true – it is hard to compare a small and independent primary school teacher training institution with a major university. And if institutions were indeed to be given steady funding, this might cause other problems. For instance, how would departments respond to a sudden increase in the number of students? It can be hard to predict how popular a degree programme is going to be.

So what actually happens will largely depend on political considerations. What to do with a university of applied sciences situated in a shrinking rural region? How to financially support small but vital departments that are not attracting enough students? According to Berenschot, the best idea would be to make decisions on the basis of the ‘fixed rate’, which is the amount all tertiary education institutions are given, regardless of their number of students. For historical reasons, some universities are currently allocated more funding than others, but perhaps this system should be revised if people want to preserve this one Dutch Literature programme, or if they wish to support a university of applied sciences situated in a shrinking rural region.

However, it will be hard to determine how to allocate the available budget, because how much support does each institution need? To this point, universities and universities of applied sciences have not provided any information on how much their degree programmes actually cost. Classroom hours, overheads, facilities… it is hard to get a good impression of what exactly they cost. It would be good if the tertiary education institutions tackled this issue at some point, the Minister wrote in her letter to the Lower House, which was submitted along with the reports.

There are other interests that hardly get a mention in the three reports. For instance, some political parties hope that if departments are awarded ‘steady’ funding, they will stop spending half their time trying to attract new students (particularly international students) and make a better effort to get students to the degree programmes that are right for them – even if they don’t actually offer those degree programmes themselves.

The impact of the reports remains to be seen. The future approach taken to tertiary education will be largely determined by the outcome of the elections to be held on 17 March. In an interview with HOP, Minister Van Engelshoven (D66) said she was amazed to hear that the party that is doing best in the opinion polls, VVD, plans to cut the lump sum awarded to universities and universities of applied sciences by 200 million euros.

She regards the reports as a ‘proper foundation’ for her call to increase the higher education budget by at least one billion, and hopes that the next Cabinet will be led by the study reports. “I hope this analysis will be taken into account when the new government is formed and that parties will say: we must make sure the level of funding suffices. The request for this study was supported by many MPs. I should think that this would come with certain obligations.”